Australia shares ease in choppy trade, miners sag on weak metals prices

Reuters - UK Focus

(Adds analysis, quotes, stocks on the move)

SYDNEY, Nov 27 (Reuters) - Australian shares eased 0.1percent in a choppy morning session on Wednesday, dragged downby the resources sector after metals prices fell overnight.

A flat performance on Wall Street, with the exception of thetech sector, provided few catalysts for buyers as investors inthe U.S. took a back seat ahead of a Thanksgivingholiday.

Miners lost ground after copper finished slightly weaker andgold fell nearly one percent overnight.

Blue chips BHP Billiton Ltd declined 1 percent andRio Tinto Ltd (Xetra: 855018 - news) gave up 1.3 percent, while bullion minersKingsgate Consolidated Ltd and Silver Lake ResourcesLtd slumped 8.1 percent and 6.5 percent respectively.

The S&P/ASX (Berlin: AUX.BE - news) 200 index fell 6.4 points to 5,350.6 by0056 GMT. The benchmark has been trading mostly sideways formuch of November as investors fret over when the U.S. FederalReserve will begin to taper its massive bond-buying program. Theindex added 0.1 percent on Tuesday.

Tim Radford, global analyst at Rivkin Securities, said in anote that the market's recent consolidation is a sign it'spreparing to resume the broader uptrend to above 5,400 points.

"Given the market's perception of risk is extremely low atthe moment, we should anticipate investors will confidently bidequities higher through December."

Banking stocks supported the market with Australia and NewZealand Banking Group and Commonwealth Bank ofAustralia each adding 0.6 percent.

The 'Big Four' banks have had a stellar year with theirshare prices surging on record earnings and high dividend yieldsof between 4.7 percent and 5.5 percent. In comparison, generaleveryday depositor accounts yield annual rates of 3-4 percent.

Oddly, upbeat data showing the value of construction workdone in Australia in the third quarter rose by 2.7 percent,almost six times above forecast, did little to excite thesector.

"Internal governance is continuing to trouble LeightonHoldings," said John Milroy, investment adviser at MacquarieBank.

"In addition to that, what's happened at Woolworths (Frankfurt: WWR.F - news) lastweek has just weighed on the whole sector," he said, referringto the retailer's loss-making home improvement business Masters,which lost $139 million in 2014 and is forecast to breakevenonly in 2016.

Last week, Leighton Holdings Ltd rejected Fairfaxmedia claims of "damning evidence linking the property developerto allegedly corrupt payments" in British high court.

Leighton fell 0.8 percent while Lend Lease Corporation Ltd dipped 1.1 percent.

Whitehaven Coal Ltd (Other OTC: WHITY - news) declined 1.1 percent, retracingsome of its gains from the previous session as the stock wasdeleted from MSCI (NYSE: MSCI - news) 's Australia Index.

New Zealand's benchmark NZX 50 index was flat at4,790.5 points.

(Reporting by Thuy Ong; Editing by Shri Navaratnam)

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